Wednesday, May 23, 2012

Blinded by the client

Don't you hate it when people are pestering you with client focus? These days everybody in an organisation should be focused on the client, it seems. I'm not sure this is always a healthy situation. As a matter of fact, I'm writing these words on an airplane heading to Dublin. I hope and I pray that the pilot is not focused on the client, but rather on his airplane dashboard.

Sure, we all know that organizations should be client focused if they want to survive, but that does not mean that all members of the organization should be client focused all of the time. It seems to be the business equivalent of the Robinson effect (Robinson, W.S. (1950). "Ecological Correlations and the Behavior of Individuals". American Sociological Review 15: 351 – 357.). Based on the 1930 US census, William S. Robinson found a positive correlation between the literacy rate of a state and the percentage of inhabitants born outside the US, while at the individual level this correlation was negative. The explanation was that immigrants, who were on average less literate, tended to go to states where the native population was more literate. More generally he warned that we should be careful with making conclusions at an individual level based on aggregated or ecological data. This effect is also known as an ecological fallacy.

In business you sometimes see the same tendency to mix up different levels as well. Organizations should be client focused but that does not mean that all people in the organization should have the same focus. Misplaced client focus often leads to complexity and inefficiencies. One company that earned the biggest part of its income through syndicated services literally "messed up" its production flow in the name of the client. All kinds of ad hoc checks and adjustments were put in place just to address one particular client complaint. Obviously you need to resolve client complaints, but then do it generally, not per client. If the solution is worse than the problem itself you should reconsider. It will come to no surprise that the client of this particular company was absolutely not "delighted" by what it got in the end. The same folks that shouted for more client focus called in a business improvement team who came to the conclusion that the checks they were doing were ... ad hoc.

Ironically, what you often see in companies that make there earnings by delivering ad hoc or customized services, is a continuous effort to leverage from commonalities between different projects. If carefully done, this can lead to a more cost efficient process that still delivers to the client needs.The other way around is far more dangerous. If you have a generic process, you can only customize by design or in a clearly separate part, typically at the end, of the process flow. The former requires pro activeness, the latter requires a lot of discipline. Most often none of both is available, leading to patch work processes that are increasingly difficult to maintain. At some point managers give up in understanding the process leading to even more bad decisions.This then goes on for a while until a bright guy or girl comes up with the idea to rebuild the legacy system or process from scratch. This usually works ... eventually, and comes at a very steep price. More often than not, time and resource pressure leads to forgetting the two aforementioned requirements of pro activeness and discipline, so that the whole circus starts again. The only winner in the game are the managers: they have secured lifelong employment for themselves.

For a while I worked in Amsterdam and there I tried to explain this principle with what I called the "tulip model". Syndicated services should strive for a common and solid base process that leaves no client specific exceptions, only downstream, i.e. the flower itself, you can customize based on the client needs. Don't confuse this with being rude to the customer. Just be fair and frank. Most often clients understand what a syndicated service means. Jokers aside, I am yet to see the first customer ordering Coq Au Vin at McDonald's.

There is also a cost attached to all exaggerated client focus. In one company almost every operational department had its very own client oriented role. Typically each department had its own name for it, going from client liaison manager, over strategic client lead, to client engineer. And this is not taking the actual client service department into account. Remarkably, despite all this client focus, clients often where not happy with the result.
I'm a very simple person and my guess is that it would have been better to simply fix the (dodgy) process and leave the client focus to the departments that are supposed to take care of this (client service, marketing, and so on).

On the other hand I applaud efforts to have operational people experience the "services" that our clients need to endure. When I worked for Nielsen, at one point I suggested to make our internal operational KPI's available through the same interfaces that we were trying to push to customers that bought our data. My thinking was that if we had to suffer what our clients had to endure, we would have a good incentive to improve it. It will come to no surprise that this never got implemented for reasons of ... efficiency.

Some people will claim that "The client is always right". And I guess that, if we forget our classes in Inductive logic, most of us can relate to it, as long as it is used in context. In fact, it is interesting to note that the quote "The client is not always right", attributed to car designer Enzo Ferrari, gets about as much hits as the "The client is always right".
I know an IT manager who would often say that we shouldn't be like "Rabbits in the light" (my guess he was referencing the French expression "être comme un lapin pris dans la lumière des phares.). Well sometimes I think that some folks in organizations are indeed behaving like rabbits "blinded by the light" of the clients. And that is often not a good place to be in, at least not all the time.
In conclusion I would like to paraphrase John Kennedy:

All people should have client focus some of the time, some people should have client focus all of the time, as long as we don't expect to have all of the people focus on the client all of the time.

Note: This entry was written a few years a go, but I thought I'd reuse it for this blog.

About Me

Istvan Hajnal is a veteran of more than 20 years in the fields of data analysis, survey methodology and market research. First at the University of Leuven, Belgium and then
about 10 years with The Nielsen Company, the world's largest Market Research Company. Istvan is currently Insights Director, Marketing & Data Sciences for GfK, Belgium.
He received a master's degree in computer science (Leuven), a master's degree in quantitative applications in the social sciences (Brussels) and finally a Phd in Social sciences from the University of Leuven.
He blogs about Data Science but occasionally also on management and leadership in general and the Market Research Industry in particular.